On the heels of CBS acquiring CNET for $1.8-billion comes another deal involving “old” media and “new” media: according to TechCrunch, the folks over at Conde Nast — the magazine publishing family that owns Vogue, the New Yorker and Wired — have plunked down about $25-million for Ars Technica, the tech site that recently caused a minor blog storm over an alleged lack of attribution in their blogs posts. Kara Swisher of All Things D has a video interview with site co-founder Ken “Caesar” Fisher.
Although Conde Nast is mostly known for print magazines, it has been making inroads into digital publishing, including the purchase of Wired (for about $25-million) last year, as well as the acquisition of Digg competitor Reddit. Conde also owns Epicurious.com and the recently-launched online magazine Portfolio, and has other online assets including Style.com and Brides.com. Conde Nast is a unit of Advance Publications, a private company controlled by the Newhouse family that also owns a number of local business journals and U.S. newspapers.
According to FM Publishing’s page on Ars Technica, the site gets about 19 million page views a month (TechCrunch says the site gets 4.5 million uniques a month, according to a source). With a CPM fee of about $36 per ad, that means the site could make as much as $2-million a month in advertising revenue — and it apparently has just eight employees, including co-founders Ken “Caesar” Fisher and Jon “Hannibal” Stokes, who started the site in 1998.
I remembered that Doug McIntyre from 24/7 Wall Street did a financial analysis of some of the leading blogs and their theoretical value awhile back, so I went and looked at it, and here’s what he said:
“Ars Technica: $15 million. High church high tech blog. Sites ranks 2,500 in Alexa. Compete shows over 800,000 visitors. Audience is growing very rapidly. Quancast has reach at 1.1 million. Ads are all premium clients. Site should be getting $40 per page CPM. Page views are probably six million a month. Revenue of almost $3 million. Site appears to have high end edit staff writing. Margin estimated at 35%. High-end site should be very valuable. Fifteen times operating profit.”
Not bad, Doug. Obviously Conde Nast thought it was worth a little more. Ken Fisher’s note to the Ars community is here.